ALSO BY STEVE COLL The Bin Ladens Ghost Wars On the Grand Trunk Road Eagle on the Street (with David A. Vise) The Taking of Getty Oil The Deal of the Century PRIVATE EMPIRE EXXONMOBIL AND AMERICAN POWER Steve Coll THE PENGUIN PRESS NEW YORK 2012 THE PENGUIN PRESS Published by the Penguin Group Penguin Group (USA) Inc., 375 Hudson Street, New York, New York 10014, U.S.A. • Penguin Group (Canada), 90 Eglinton Avenue East, Suite 700, Toronto, Ontario, Canada M4P 2Y3 (a division of Pearson Penguin Canada Inc.) • Penguin Books Ltd, 80 Strand, London WC2R 0RL, England • Penguin Ireland, 25 St. Stephen’s Green, Dublin 2, Ireland (a division of Penguin Books Ltd) • Penguin Books Australia Ltd, 250 Camberwell Road, Camberwell, Victoria 3124, Australia (a division of Pearson Australia Group Pty Ltd)• Penguin Books India Pvt Ltd, 11 Community Centre, Panchsheel Park, New Delhi – 110 017, India • Penguin Group (NZ), 67 Apollo Drive, Rosedale, Auckland 0632, New Zealand (a division of Pearson New Zealand Ltd) • Penguin Books (South Africa) (Pty) Ltd, 24 Sturdee Avenue, Rosebank, Johannesburg 2196, South Africa Penguin Books Ltd, Registered Offices: 80 Strand, London WC2R 0RL, England First published in 2012 by The Penguin Press, a member of Penguin Group (USA) Inc. Copyright © Steve Coll, 2012 All rights reserved Map illustrations by Gene Thorpe LIBRARY OF CONGRESS CATALOGING IN PUBLICATION DATA Coll, Steve. Private empire : ExxonMobil and American power / by Steve Coll. p. cm. Includes bibliographical references and index. ISBN 978-1-101-57214-6 1. Exxon Corporation. 2. Exxon Mobil Corporation. 3. Petroleum industry and trade—Political aspects— United States. 4. Corporate power—United States. 5. Big business—United States. I. Title. HD9569.E95C65 2012 338.7'6223380973—dc23 2011044722 No part of this book may be reproduced, scanned, or distributed in any printed or electronic form without permission. Please do not participate in or encourage piracy of copyrighted materials in violation of the author’s rights. Purchase only authorized editions. While the author has made every effort to provide accurate telephone numbers, Internet addresses, and other contact information at the time of publication, neither the publisher nor the author assumes any responsibility for errors, or for changes that occur after publication. Further, publisher does not have any control over and does not assume any responsibility for author or third-party Web sites or their content. Contents LIST OF MAPS AUTHOR’S NOTE SELECTED CAST OF CHARACTERS Prologue. “I’m Going to the White House on This” PART ONE: THE END OF EASY OIL One. “One Right Answer” Two. “Iron Ass” Three. “Is the Earth Really Warming?” Four. “Do You Really Want Us as an Enemy?” Five. “Unknown Injury” Six. “E.G. Month!” Seven. “The Camel and the Jackal” Eight. “We Target Oil Companies” Nine. “Real Men—They Discover Oil” Ten. “It’s Not Quite as Bad as It Sounds” Eleven. “The Haifa Pipeline” Twelve. “How High Can We Fly?” Thirteen. “Assisted Regime Change” Fourteen. “Informed Influentials” PART TWO: THE RISK CYCLE Fifteen. “On My Honor” Sixteen. “Chad Can Live Without Oil” Seventeen. “I Pray for Exxon” Eighteen. “We Will Need Witnesses” Nineteen. “The Cash Waterfall” Twenty. “Moonshine” Twenty-one. “Can’t the C.I.A. and the Navy Solve This Problem?” Twenty-two. “A Person Would Have to Eat More Than 3,400 Rubber Ducks” Twenty-three. “We Must End the Age of Oil” Twenty-four. “Are We Out? Or In?” Twenty-five. “It’s Not My Money to Tithe” Twenty-six. “We’re Confident You Can Book the Reserves” Twenty-seven. “One Plus One Has Got to Equal Three” Twenty-eight. “It Just Happened” ACKNOWLEDGMENTS NOTES BIBLIOGRAPHY INDEX List of Maps Upstream Investments of Exxon and Mobil Before Merger Indonesia Equatorial Guinea Chad Exxon Spill in Jacksonville, Maryland Venezuela Author’s Note F our journalists made important contributions to this book while working as researchers during the four-year life of the project. Ben Van Huevelen, who is now the managing editor of the Iraq Oil Report, worked on that subject and ExxonMobil’s litigation with Venezuela, as well as on corporate responsibility issues in Africa and Indonesia. Megha Rajagopalan, a 2008 graduate of the University of Maryland who is now studying in China under the Fulbright Scholar Program, worked on global warming, the Exxon Valdez spill, and phthalate regulation; chapters five and twenty-two benefited greatly from her research. Ann O’Hanlon, a former Washington Post reporter who now works at the Justice Department, reported on many subjects, but especially on campaign finance and lobbying; her work particularly supported chapters three, seventeen, twenty-two, and twenty-three. Haley Cohen, a 2011 graduate of Yale University who is now on a university fellowship in Latin America, recontacted many interview subjects, checked facts and interpretations, and added fresh reporting throughout. The book benefited from other supporters and collaborators; the acknowledgments provide an accounting. I am grateful and deeply indebted to all. Selected Cast of Characters AT EXXONMOBIL Russell Bowen, Maryland territory manager John Paul Chaplin, lead country manager, Nigeria, circa 2005–2009 Ken Cohen, vice president of public affairs Tim Cutt, lead country manager, Venezuela, 2005–2007 Steven K. Davidson, outside lawyer in Venezuelan litigation Theresa Fariello, director of the Washington office, 2009 to present Brian Flannery, astrophysicist, climate policy adviser Rosemarie Forsythe, Russia adviser, planner for international political strategy Edward G. Galante, senior executive, contender to succeed Raymond, retired 2006 Otto Harrison, lead executive on Exxon Valdez cleanup Ralph Daniel Nelson, lead country manager, Saudi Arabia, 2001–2004, director of the Washington office, 2005–2009 Lee R. Raymond, chairman and chief executive, 1993–2005 James Rouse, director of the Washington office, late 1990s–2005 Ron Royal, lead country manager, Chad, circa 2006 James F. Sanders, lead outside lawyer, Alban v. ExxonMobil Frank Sprow, vice president, Safety, Health, and Environment, 2000– 2005 Sherri Stuewer, senior executive, environmental policy, 2006 to present Rex Tillerson, upstream executive with responsibility for Russia, later chairman and chief executive, 2006 to present Glenn Waller, lead country manager, Russia, circa 2003 Martin J. Weinstein, lead outside lawyer, John Doe v. ExxonMobil Ronald I. Wilson, lead country manager, Indonesia IN THE U.S. GOVERNMENT Representative Joe Barton, R-Texas, 1984 to present George W. Bush, president, 2001–2009 Richard B. Cheney, vice president, 2001–2009 Representative John Dingell, D-Mich., 1955 to present Don Evans, secretary of commerce, 2001–2005 Douglas Feith, undersecretary of defense for policy, 2001–2005 Robert Gelbard, ambassador to Indonesia, 1999–2001 Christopher Goldthwait, ambassador to Chad, 1999–2004 Barack Obama, president, 2009– Judge Louis F. Oberdorfer, United States District Court, Washington, D.C. Colin Powell, secretary of state, 2001–2005 Anton Smith, United States chargé d’affaires, Equatorial Guinea, 2008– 2009 Alexander Vershbow, ambassador to Russia, 2001–2005 Marc Wall, ambassador to Chad, 2004–2007 Paul Wolfowitz, deputy secretary of defense, 2001–2005; president, World Bank, 2005–2007 IN AFRICA Victor Attah, governor of Akwa Ibom State, Nigeria, 1999–2007 Idris Déby, president of Chad, 1990 to present Simon Mann, former British Army officer, led coup attempt in Equatorial Guinea Teodoro Obiang Nguema, president of Equatorial Guinea, 1979 to present IN ALASKA